Forex news for North American trading on September 29, 2021.
- NASDAQ index cannot hold gains and closes lower for the fourth consecutive day
- More from WH: Biden is disappointed in McConnell's stance on the debt ceiling
- Fed's Daly: Expects bar for the taper to be met by the end of this year
- White House: It has the sense Sen. Sinema does want to see a reconciliation bill
- Crude oil futures settle at $74.83
- How the legacy of the pandemic may be a great realignment of worker priorities
- Subtle shifts in central bank language highlight fresh worry about inflation
- Pelosi: House to move forward with legislation on suspending debt limit
- Powell: Supply side constraints are what's really holding back the economy right now
- BOE's Bailey: UK recovery is uneven
- ECB's Lagarde: The resolution of bottlenecks is uncertain, should fade in H1 2022
- BOJ's Kuroda: Japanese consumption is still very weak
- European equity close: Solid bounce-back day
- US EIA weekly crude oil inventories +4578K vs -1652K expected
- Schumer: Senate could take action as early as today on gov't funding
- US August pending home sales +8.1% m/m vs +1.4% expected
- Fed's Harker does not expect a hike until late 2022 or early 2023
- Canada August producer price index -0.3% m/m vs +0.4% prior
- The JPY is the strongest and the NZD is the weakest as the NA session begins
- ForexLive European FX news wrap: Dollar firms even as Treasury yields cool off a little
The US dollar moved sharply higher today and in the process hit new year-to-date highs. The dollar has risen for four consecutive sessions.
The gains have been helped by higher interest rates recently. However today yields were lower for most the day until later in the day when yields started to move back to the upside. The 10 year yield is marginally higher as the day draws to a close.
That pause in the rate rise did not hurt the dollar demand as the greenback is at, or near, it's highs for the day vs all the major currencies. Moreover, the dollar reached a new 2021 high verse the EUR, GBP, and JPY.
The biggest mover of the day was the NZDUSD which fell by 1.37% (higher USD). Both the EURUSD and the AUDUSD were lower by about 0.89% (also higher USD). The USDJPY rose the least (by 0.43%) but nevertheless, extended above 112.00 for the first time since February 21, 2020. Below is a ranking of the stressed weakest of the majors. The US dollar and the NZD outpaced the other currencies in their respective directional moves
Some technical highlight for some of the major currency pairs shows:
- The EURUSD fell below its low price for the year at 1.16634 and continued the run to the downside reaching a low for the day at 1.15886. The current price is just above that level I.15943. That move also took the price below the swing lows from September 2020 and November 2020 which we are at 1.1601 to 1.1611. In the new trading day, that swing area will be eyed as a close resistance.
- GBPUSD: The GBPUSD extended its range for the year by falling below the January 2021 low of 1.34498. The price cracked below that level, and has reached a new low for the year at 1.3411. In the new trading day, as always the price can remain below the old swing low at 1.34498, the sellers remain in control.
- USDJPY: The USDJPY was able to extend above the 2021 high of 111.653 and also a swing high going all the way back to March 2020 not far from that level at 111.703. The high price reached above the 112.00 level to the highest level since February 21 at 112.043. Going forward staying above the old 2021 high at 111.653 keeps the buyers more control. The USDJPY has now been up for six consecutive trading days.
- NZDUSD: The NZDUSD move below a swing low going back to July at 0.68802. Back in August, that level was also broken on its way to the low for the year at 0.68042. The low price reached 0.68569 and is currently training 0.68621. The NZDUSD is lower despite the expectations at the Reserve Bank of New Zealand will raise rates by 25 basis points at their next meeting next. The China impact is having a greater effect on the value of the currency as is the dollar buying and risk off sentiment.
Meanwhile in the US stock market, the NASDAQ index closed lower for the fourth consecutive day. The S&P snapped its three-day losing streak, but closed near lows. Both the S&P and NASDAQ are on the track for the worst month since September 2020. The NASDAQ is 5%+ lower from its high while the Dow and S&P are trading at 3%+ from its highs. The Dow is on track for its worst month since October 2020
The final numbers are showing:
- Dow industrial average rose 90.73 points or 0.269% at 34390.73
- S&P index rose 6.81 points or 0.16% at 4359.45
- NASDAQ index fell 34.24 points or -0.24% at 14512.44
- Russell 2000 fell -4.47 points or -0.20% at 2225.31
In the US debt market, yields and traded lower for most of the US trading day hours, but as we head into the close the 10 year yield is now up by 0.5 basis points. The 30 years up 2.0 basis points. The shorter end is still lower but off it's a lowest levels on the day:
In other markets as the US session comes to an end is showing:
- Spot gold $-8.50 or -0.5% at $1725.37
- Spot silver is down sharply by -$0.91 or -4.09% at $21.50
- WTI crude oil futures fell $0.58 or -0.77% at $74.71. The inventory data today showed a surprise build and inventories of 4.6 million barrels versus expectations of 2.8 million barrel drawdown. That helped to slow the rise in the price of crude oil which reached an intraday high of $75.79
- Bitcoin is trading up $100 at $41,155. That is well off the highs for the day at $42,595 and closer to its lows of $40,750
